Average Savings In the US
Have you ever felt the need to save some of the money that comes from your paychecks? Know that you’re not alone in this feeling. Saving money in this day and age is a reality that is faced by basically all Americans; however, not everyone is in the same boat when it comes to saving their hard-earned money. Some people may not be as successful as others when it comes to saving.
If you are just beginning your financial journey, you may wonder about the importance of saving money. Saving money can help you when an unexpected event may occur, such as an emergency. Also, if you are financially stable and have financial wellbeing, you may be able to plan for an earlier retirement or indulge yourself more. Saving money is an incredibly important lesson to learn to help with your budgeting and spending.
Perhaps you are wondering how much money the average American has in savings. If your savings account is low, you aren’t alone. Many Americans can face multiple challenges and pressures rather than saving money that stems from needing to pay off loans, bills, or other expenses. It may shock you to learn that the average household American saving fund typically contains less than $10,000. Just one emergency could completely blow through that fund! We’re going to dive into looking at the amount of money saved by Americans further.
By the Numbers
How much money does the average American have? Well, in a 2019 study conducted by Bankrate, on the average amount of savings in the US, it was found that the typical American household only has an average savings of $8,863. This number may be a surprise for many, as it truly isn’t that high. That number isn’t extremely livable if something were to happen. In the table below, you’ll find some of the numbers focusing on the amount of average American savings by age.
|Ages 35 – 44
|Singles with children
|Singles with no children
|Couples with children
|Couples with no children
These numbers are probably relatively lower than you would expect. It makes you wonder what would happen if there was an event were to occur that would make it impossible for someone to work and earn money. How long could they make use of their emergency savings if this were to happen? And, if singles with children only have $2,422 in savings at 35, how can you expect to have more savings by age 30?
In this study, it was shown that if something were to happen, just 29% of Americans would be able to use their savings to cover expenses for six months or more. 18% of those Americans could live off their savings for three to five months, and 23% would be okay on their savings for less than three months. However, a staggering percentage of 23% wouldn’t be able to support themselves with their savings.
How much do Americans have in emergency savings?
|3 months worth
|3-5 months worth
|6+ months worth
Understanding the Numbers
The consistency in these low numbers shows that many young Americans are not focused on putting aside their money to save. Many people probably do not use a monthly budget or tuck away a bit of saving from each of their paychecks to use in case of an emergency. It is alarming to think about how much debt young Americans would be met if an emergency were to occur.
What resources would they be able to fall back upon? Would they be able to pay their bills, afford to house, be able to eat, or everything else that falls upon basic survival? If these statistics make you want to reevaluate your savings plan, then maybe it’s time to rethink your plan.
Having a financial plan can take you a long way. It can help you better understand your finances and will allow you to look forward to the future. While the average savings in the US for retirement is quite low, you can get a head start by contacting DebtQuest USA. Our mission is to help you prioritize your financial goals and to equip you with the tools you need to make your dreams a reality.